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Segment Information | 9 Months Ended
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Sep. 30, 2025
Segment Reporting [Abstract] |
Segment Information | SEGMENT INFORMATION Our Personal Lines segment writes insurance for personal autos, special lines products (e.g., recreational vehicles, such as motorcycles, RVs, and watercraft), personal residential property insurance for homeowners and renters, umbrella insurance, and flood insurance through the “Write Your Own” program for the National Flood Insurance Program. Property information for the three and nine months ended September 30, 2024, was recast to conform to the current year presentation; see Note 10 – Segment Information in our 2024 Annual Report to Shareholders for further discussion. Our Commercial Lines segment writes auto-related liability and physical damage insurance, business-related general liability and commercial property insurance predominately for small businesses, and workers’ compensation insurance primarily for the transportation industry. Our service businesses provide insurance-related services, including serving as an agent for homeowners, general liability, and workers’ compensation insurance, among other products, through programs in our direct Personal Lines and Commercial Lines businesses. All segment revenues are generated from external customers and all intercompany transactions are eliminated in consolidation. Following are the operating results for the respective periods:
(millions) |  | Personal Lines |  | Commercial Lines |  | Other 1 |  | Companywide
Three Months Ended September 30, 2025 |  |  |  |  |  |  |  |
Net premiums earned |  | $ | 18,089 |  |  | $ | 2,760 |  |  | $ | 0 |  |  | $ | 20,849 |
Fees and other revenues |  | 272 |  |  | 34 |  |  | 0 |  |  | 306 |
Total underwriting revenue |  | 18,361 |  |  | 2,794 |  |  | 0 |  |  | 21,155 |
Losses and loss adjustment expenses: |  |  |  |  |  |  |  |
Losses (excluding catastrophe losses) |  | 9,801 |  |  | 1,575 |  |  | 1 |  |  | 11,377 |
Catastrophe losses |  | 207 |  |  | 12 |  |  | 0 |  |  | 219 |
Loss adjustment expenses |  | 1,554 |  |  | 296 |  |  | (1) |  |  | 1,849 |
Total losses and loss adjustment expenses |  | 11,562 |  |  | 1,883 |  |  | 0 |  |  | 13,445 |
Underwriting expenses: |  |  |  |  |  |  |  |
Distribution expenses 2 |  | 2,507 |  |  | 313 |  |  | 1 |  |  | 2,821 |
Other underwriting expenses 3 |  | 2,394 |  |  | 300 |  |  | 5 |  |  | 2,699 |
Total underwriting expenses |  | 4,901 |  |  | 613 |  |  | 6 |  |  | 5,520 |
Pretax underwriting profit (loss) |  | $ | 1,898 |  |  | $ | 298 |  |  | $ | (6) |  |  | 2,190 |
Investment profit (loss)4 |  |  |  |  |  |  |  | 1,209 |
Service businesses profit (loss) |  |  |  |  |  |  |  | (6) |
Interest expense |  |  |  |  |  |  |  | (70) |
Total pretax profit (loss) |  |  |  |  |  |  |  | $ | 3,323 |
(millions) |  | Personal Lines |  | Commercial Lines |  | Other 1 |  | Companywide
Three Months Ended September 30, 2024 |  |  |  |  |  |  |  |
Net premiums earned |  | $ | 15,570 |  |  | $ | 2,727 |  |  | $ | 0 |  |  | $ | 18,297 |
Fees and other revenues |  | 235 |  |  | 43 |  |  | 0 |  |  | 278 |
Total underwriting revenue |  | 15,805 |  |  | 2,770 |  |  | 0 |  |  | 18,575 |
Losses and loss adjustment expenses: |  |  |  |  |  |  |  |
Losses (excluding catastrophe losses) |  | 8,514 |  |  | 1,607 |  |  | (1) |  |  | 10,120 |
Catastrophe losses |  | 698 |  |  | 34 |  |  | 0 |  |  | 732 |
Loss adjustment expenses |  | 1,382 |  |  | 276 |  |  | 0 |  |  | 1,658 |
Total losses and loss adjustment expenses |  | 10,594 |  |  | 1,917 |  |  | (1) |  |  | 12,510 |
Underwriting expenses: |  |  |  |  |  |  |  |
Distribution expenses 2 |  | 2,267 |  |  | 297 |  |  | 0 |  |  | 2,564 |
Other underwriting expenses 3 |  | 1,245 |  |  | 248 |  |  | 3 |  |  | 1,496 |
Total underwriting expenses |  | 3,512 |  |  | 545 |  |  | 3 |  |  | 4,060 |
Pretax underwriting profit (loss) |  | $ | 1,699 |  |  | $ | 308 |  |  | $ | (2) |  |  | 2,005 |
Investment profit (loss)4 |  |  |  |  |  |  |  | 1,020 |
Service businesses profit (loss) |  |  |  |  |  |  |  | (9) |
Interest expense |  |  |  |  |  |  |  | (70) |
Total pretax profit (loss) |  |  |  |  |  |  |  | $ | 2,946 |
(millions) |  | Personal Lines |  | Commercial Lines |  | Other 1 |  | Companywide
Nine Months Ended September 30, 2025 |  |  |  |  |  |  |  |
Net premiums earned |  | $ | 52,343 |  |  | $ | 8,224 |  |  | $ | 1 |  |  | $ | 60,568 |
Fees and other revenues |  | 784 |  |  | 112 |  |  | 0 |  |  | 896 |
Total underwriting revenue |  | 53,127 |  |  | 8,336 |  |  | 1 |  |  | 61,464 |
Losses and loss adjustment expenses: |  |  |  |  |  |  |  |
Losses (excluding catastrophe losses) |  | 28,484 |  |  | 4,695 |  |  | 0 |  |  | 33,179 |
Catastrophe losses |  | 1,349 |  |  | 36 |  |  | 0 |  |  | 1,385 |
Loss adjustment expenses |  | 4,415 |  |  | 875 |  |  | 0 |  |  | 5,290 |
Total losses and loss adjustment expenses |  | 34,248 |  |  | 5,606 |  |  | 0 |  |  | 39,854 |
Underwriting expenses: |  |  |  |  |  |  |  |
Distribution expenses 2 |  | 7,183 |  |  | 907 |  |  | 2 |  |  | 8,092 |
Other underwriting expenses 3 |  | 4,967 |  |  | 823 |  |  | 13 |  |  | 5,803 |
Total underwriting expenses |  | 12,150 |  |  | 1,730 |  |  | 15 |  |  | 13,895 |
Pretax underwriting profit (loss) |  | $ | 6,729 |  |  | $ | 1,000 |  |  | $ | (14) |  |  | 7,715 |
Investment profit (loss)4 |  |  |  |  |  |  |  | 3,053 |
Service businesses profit (loss) |  |  |  |  |  |  |  | (18) |
Interest expense |  |  |  |  |  |  |  | (209) |
Total pretax profit (loss) |  |  |  |  |  |  |  | $ | 10,541 |
(millions) |  | Personal Lines |  | Commercial Lines |  | Other 1 |  | Companywide
Nine Months Ended September 30, 2024 |  |  |  |  |  |  |  |
Net premiums earned |  | $ | 43,706 |  |  | $ | 7,949 |  |  | $ | 0 |  |  | $ | 51,655 |
Fees and other revenues |  | 647 |  |  | 127 |  |  | 0 |  |  | 774 |
Total underwriting revenue |  | 44,353 |  |  | 8,076 |  |  | 0 |  |  | 52,429 |
Losses and loss adjustment expenses: |  |  |  |  |  |  |  |
Losses (excluding catastrophe losses) |  | 24,225 |  |  | 4,781 |  |  | (4) |  |  | 29,002 |
Catastrophe losses |  | 2,279 |  |  | 69 |  |  | 0 |  |  | 2,348 |
Loss adjustment expenses |  | 3,903 |  |  | 824 |  |  | 0 |  |  | 4,727 |
Total losses and loss adjustment expenses |  | 30,407 |  |  | 5,674 |  |  | (4) |  |  | 36,077 |
Underwriting expenses: |  |  |  |  |  |  |  |
Distribution expenses 2 |  | 5,655 |  |  | 855 |  |  | 0 |  |  | 6,510 |
Other underwriting expenses 3 |  | 3,468 |  |  | 726 |  |  | 7 |  |  | 4,201 |
Total underwriting expenses |  | 9,123 |  |  | 1,581 |  |  | 7 |  |  | 10,711 |
Pretax underwriting profit (loss) |  | $ | 4,823 |  |  | $ | 821 |  |  | $ | (3) |  |  | 5,641 |
Investment profit (loss)4 |  |  |  |  |  |  |  | 2,339 |
Service businesses profit (loss) |  |  |  |  |  |  |  | (25) |
Interest expense |  |  |  |  |  |  |  | (209) |
Total pretax profit (loss) |  |  |  |  |  |  |  | $ | 7,746 |
1 Includes other underwriting business and run-off operations. 2 Includes policy acquisition costs, agents’ contingent commissions, and advertising costs attributable to our operating segments. A portion of our companywide advertising costs are also attributed to our service businesses. 3 Primarily consists of employee compensation and benefit costs, policyholder credits, and the increase in the allowance for credit loss exposure on our premiums receivable. 4 Calculated as recurring investment income plus total net realized gains (losses) on securities, less investment expenses. In the tables above, the results for the Personal Lines segment for both the three and nine months ended September 30, 2025, included $950 million of policyholder credit expense, included within other underwriting expenses. During the third quarter 2025, we determined it was probable that our personal auto profit in Florida for the 2023 to 2025 period will exceed the statutory profit limit that a Florida statute imposes on the profit that any insurance group can earn on personal auto insurance over any three-calendar-year period. In such event, we would need to credit any profit, above the limit, to all Florida personal auto policyholders active at December 31, 2025. Further, the accrual represents our current estimate of the profit we will earn on the three-calendar-year period ending December 31, 2025, in excess of the permitted profit limit. The expense is reported in policyholder credit expense on the consolidated statements of comprehensive income and the accrual is included in accounts payable, accrued expenses, and other liabilities on our consolidated balance sheets. Our management uses underwriting margin and combined ratio as primary measures of underwriting profitability. The underwriting margin is the pretax underwriting profit (loss) expressed as a percentage of net premiums earned. Pretax underwriting profit (loss) is calculated as net premiums earned plus fees and other revenues, less: (i) losses and loss adjustment expenses; (ii) policy acquisition costs; (iii) other underwriting expenses; and (iv) policyholder credit expense. Combined ratio is the complement of the underwriting margin. Fees and other revenues are netted against either loss adjustment expenses or underwriting expenses in the ratio calculations, based on the underlying activity that generated the revenue. Following are the underwriting margins and combined ratios for our underwriting operations for the respective periods:
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
| Under- writing Margin | Combined Ratio |  | Under- writing Margin | Combined Ratio |  | Under- writing Margin | Combined Ratio |  | Under- writing Margin | Combined Ratio
Personal Lines | 10.5 | % | 89.5 |  |  | 10.9 | % | 89.1 |  |  | 12.9 | % | 87.1 |  |  | 11.0 | % | 89.0 |
Commercial Lines | 10.8 |  | 89.2 |  |  | 11.3 |  | 88.7 |  |  | 12.2 |  | 87.8 |  |  | 10.3 |  | 89.7 |
Total underwriting operations | 10.5 |  | 89.5 |  |  | 11.0 |  | 89.0 |  |  | 12.7 |  | 87.3 |  |  | 10.9 |  | 89.1 |

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